Significant progress achieved during Troika-Cyprus talks

Finance Minister Michalis Sarris said Saturday significant progress was achieved during the Cyprus government talks with Cyprus’ international lenders and this will help reach an agreement.

Speaking after the morning talks at the Ministry of Finance between the government and a Troika delegation, Sarris said that the progress helps in reaching an agreement, at least on the part of Troika which will make its suggestions to Eurogroup.

The talks are scheduled to resume in the afternoon.

Sarris said the first meeting this morning with the Troika was on the basis of a paper that Cyprus had prepared “outlining in some details a comprehensive proposal on our side”.

The majority of the issues on that paper, he added, did not call for any further work, but there were two-three issues which he did not want to go to any detail, “that called for greater codification, greater analysis so that all parties can be absolutely sure that we understand the same thing”. Sarris acknowledged that “these are new experiences for everybody”,  adding that they have a number of experts that are working from the private sector, from the Central Bank at the Ministry of Finance, trying to iron out these details “so that when we do reach an agreement there will be no room for different understandings or misrepresentations”.

Asked if Troika is also calling for a haircut for all bank deposits or is merely talking about the Bank of Cyprus, Sarris said he did not want to go into details, adding however that “this is amongst the issues we are discussing and we will resume in the afternoon to find out the best way possible”.

“We must secure the stability of our financial system and be able to open our banks on Tuesday with a clear picture of things”, he said.

Cyprus must raise €5.8bn before Monday to qualify for the €10bn EU bailout it needs to prevent the collapse of its banks.

On Friday, the Cypriot parliament passed nine bills, including three that would see ailing banks restructured, starting with Laiki, Cyprus`s second-largest bank, a “national solidarity fund” and capital controls that would prevent large withdrawals from the country.

A decision is pending on a controversial bank savings levy and how it would be applied. This is due to be considered at the House on Saturday. The new bank levy would only apply to people with more than €100,000 in their accounts